Indexes Mixed as Oil Hovers Around $50

Stocks slogged to a mixed close Tuesday as oil prices briefly rose above $50 a barrel, then retreated.

The euro climbed to a record high against the dollar after a senior Russian central bank official said the bank might boost the amount of euros in its reserves, potentially at the expense of dollar holdings.

On Wall Street, the Dow Jones industrial average edged up 3.18 points to 10,492.60, after trading in a narrow range for most of the day.

Other key indexes were mixed. The Standard & Poor’s 500 fell 0.30 point to 1,176.94 and the Nasdaq composite lost 0.91 point to 2,084.28.

Investors continued to show a preference for shares of smaller companies: The Russell 2,000 index of smaller stocks added 3.01 points, or 0.5%, to a record 624.53. It is up 12% this year, compared with a 5.9% gain for the blue-chip S&P; 500.

Rising stocks outnumbered losers by more than 3 to 2 on the New York Stock Exchange and by a narrower margin on Nasdaq.

Many traders said the equity market was hostage to the oil market’s gyrations Tuesday.

Near-term crude oil futures in New York rose as high as $50.25 a barrel, then pulled back to close at $48.94, up 30 cents.

After sliding for much of this month, oil has turned higher in recent days on concerns about tight global supplies of heating fuel, analysts said.

“We’ve run out of time to ramp up heating-oil inventories,” James Cordier, head of Liberty Trading Group, a St. Petersburg, Fla.-based futures broker, told Bloomberg News. “We’re going to be living with high heating oil prices through winter,” which will support crude oil prices, he said.

In currency trading, the euro rose to a record $1.308 from $1.304 on Monday. The euro gained after Alexei Ulyukayev, first deputy chairman of Russia’s central bank, told reporters that the bank might review whether to raise the portion of its $100 billion in foreign currency reserves that is held in euros.

“Most of our reserves are in dollars, and that’s a cause for concern” as the dollar’s value wanes, Ulyukayev said. “Looking at the dynamics of the euro-dollar rate, we are discussing the possibility to change the reserve structure.”

The slumping dollar has become a hot topic in global markets in recent days. The greenback’s decline has raised fears that foreign investors might shun dollar-denominated assets.

But an auction Tuesday of $24 billion in two-year Treasury notes attracted strong demand, including from foreign buyers, traders said. The annualized yield on the notes was 2.95%.

Indirect bidders, which include foreign central banks, bought 43.5% of the securities, up from 41.3% at the Treasury’s sale of two-year notes last month.

Treasury bond yields ended the day little changed. The 10-year T-note was at 4.19%, up from 4.18% on Monday.

Among Tuesday’s market highlights:

* McDonald’s helped lift the Dow, rising 72 cents to $30.10 after announcing late Monday that Vice Chairman Jim Skinner would succeed Charlie Bell as chief executive. Bell is fighting cancer.

* Among Southland issues, construction giant Fluor continued its recent surge, rising $3.34 to $51.85, a three-year high. Wall Street expects the company to win more industrial contracts as business spending increases.

* In the tech sector, Google added $2.42 to $167.52, then jumped to $176 in after-hours trading. After markets closed, brokerage Goldman Sachs said it expected the stock to reach $215 within 12 months

On the downside, Intel lost 73 cents to $23.37 after brokerage CS First Boston cut its rating on the stock to “underperform” from “outperform,” saying the chip giant wasn’t well-positioned for longer-term growth.

* TXU led the utility sector higher after announcing a stock buyback. TXU rose $1.18 to $65.74. The Dow utilities index was up 1.34 points, or 0.4%, to 331.92, a three-year high.

* World Wrestling Entertainment tumbled $1.36 to $12.04 after saying that quarterly net income fell sharply on lower TV advertising revenue and higher production costs.

* The dollar was mixed. It firmed against the yen and the Canadian dollar. Near-term gold futures in New York eased $1 to $447.80 an ounce after reaching a 16-year high Monday.